04 February 2010

House Hunting in Amsterdam

This 187-square-meter (2,000-square-foot) open apartment is on the Brouwersgracht (brewers’ canal) in central Amsterdam. It is one of nine units in a 1631 building that at one time was a brewery and at another a fire station. The apartment is on the second floor, overlooking the canal and its houseboats.

According to the listing agent, the building was occupied by squatters in the 1980s and last renovated in 1998. The floors are of polished concrete, and original wooden beams rib the ceilings.

The entry, an old steel door, opens into the kitchen, which has a wall of cabinets and kitchen appliances by Bosch and Siemens, as well as a dining table that seats 12. There is also a separate galley-style utility kitchen off the main kitchen, with a refrigerator, a freezer, a dishwasher, a washer/dryer and a second sink.

The living room runs the width of the building, about 11 meters (36 feet), and has doors that open above the Brouwersgracht.

Both bedrooms have en-suite bathrooms and slanted walls.

The apartment is at the edge of Amsterdam’s central canal area, the Grachtengordel, and within the Jordaan neighborhood, known for its art galleries and boutiques. The house is a short walk from Haarlemmerdijk, a commercial strip with bakeries, cafes and boutiques. The Amsterdam Centraal train station and tram and Metro lines are also a few blocks away.

MARKET OVERVIEW

Prices have come down in the last few years — even in the pricey and coveted Centrum area of town — although real estate agents in Amsterdam disagree on the exact percentage of the drop.

In general, said Charles Grayson, owner of a realty agency called 27 Huis Makelaars, prices have dropped around 10 percent since the height of the market in 2008. “This year,” he said, “they’ve pretty much stabilized. People expect it to be a bit better starting in the springtime.”

Gernant van Alphen, an agent for Anna Sprenger Makelaardij, the Amsterdam brokerage for the apartment featured here, said that in the canal area there were still houses selling “at or even over the asking price in the first week.”

“But then,” he added, “you have houses that are on the market for a year.” Most of the time, he said, properties stay on the market for 8 to 10 weeks.

“It’s a good time to be a buyer right now,” Mr. Grayson said. “Things have been sitting on the market quite a while.”

In central Amsterdam most units sell for around 4,500 euros a square meter, or about $584 a square foot. Single-family homes rarely come on the market, and when they do, they typically sell for millions of euros depending on condition. Canal-front properties are a premium.

Since Amsterdam is roughly six and a half feet below sea level, many buildings rest on wooden piles. Before a purchase, an home inspector should be hired to examine the state of the property’s foundation, which can be several hundred years old; inspections cost 500 euros ($700), but repairs can cost up to 1,500 euros per square meter (about $195 a square foot), said Rik Bisschoff van Heemskerk, owner of De Nederlanden real estate brokerage.

“If the poles are rotting,” he said, “within five years, you’re not going to be able to live there anymore.”WHO BUYS IN AMSTERDAM

The property market has been popular among German, Irish and British expatriates, Mr. Grayson said; he also cited some Americans and other Europeans. However, Mr. van Alphen says a large percentage of Americans who come to the city for work live in apartments rented by their companies.BUYING BASICS

Real estate transactions operate somewhat differently from those in the United States, Mr. Grayson said. To start with, down payments are not typically required. Banks lend the entire value of the house plus the closing costs, and even on occasion money for renovations. Even so, there are lending restrictions.

Until recently, the loan maximum was set at seven times the gross annual salary of a borrower. Now, in this tighter mortgage market, Mr. Grayson said, banks are lending only four to five times a borrower’s gross annual salary. There are of course exceptions; the amount can be higher (or lower) depending on individual circumstances. But basically banks have become much more reticent about mortgages these days.“If you’re from the E.U.,” Mr. Grayson said, “it’s much easier to get a mortgage. If you’re an American like I am, it’s a little bit harder, but of course it’s possible, especially if you work for a reputable company.”

Closing costs can be as high as 12 percent of the sale price but are more typically 10 percent. Six percent of that amount covers transfer fees; the rest is split between the notary and the broker. In the Netherlands, buyers pay their own broker fees.